Mass. tax hike would hit pay of workers from Nashua, other NH towns

NASHUA - New Hampshire residents who commute south for their jobs have varying views and concerns about a proposal to raise the income tax in Massachusetts, which could ultimately cut their paychecks if approved.

Brian McCarthy is a Nashua resident who commutes to Waltham, Mass., for his job at NetApp. Although he was not aware of Mass. Gov. Deval Patrick's proposal to increase the Massachusetts income tax, McCarthy acknowledged that he would have legitimate concerns if the tax hike was ultimately implemented.

"I think it will hurt. Not only will it hurt the employees who work in Massachusetts, but it will more likely hurt companies seeking to relocate," said McCarthy. "This could be to New Hampshire's advantage."

Businesses who may want to expand or move into different facilities might think twice about relocating within Massachusetts, he said, explaining they might consider moving to New Hampshire, where there is no state income tax.

While McCarthy spent more than 20 years previously working in New Hampshire, his job moved to Massachusetts.

"Every day when I sit in traffic on Route 3, I wonder what I am paying for," said McCarthy, who notes he is pleased to still have a job during challenging economic times.

The potential for an income tax hike in Massachusetts will probably not persuade McCarthy to consider finding employment here in New Hampshire - in fact, none of those interviewed said it would - but he said the hit will probably be worrisome for many Granite State families bringing home a paycheck from Massachusetts.

Jay LaRoche, who lives with his wife and two children in Bedford, travels to Oxford, Mass., for his job at Wilson Language Training. His family, according to LaRoche, is very worried about his paycheck shrinking. Being from New Hampshire, LaRoche said, he has always been concerned about the taxes he pays to the south.

If Patrick is successful, LaRoche said, it could have a "modest but important negative impact on discretionary spending and savings."

The Claffey family of Nashua has a different view on the potential tax increase, which would be used to pay for various educational initiatives in the Commonwealth.

"I doubt that my view is fairly typical, but I support what they are trying to do in Massachusetts," said Renae Lias Claffey, who works at the University of Massachusetts at Lowell. "If you want to support the public university system, you need to have a broadbased tax in place. I really believe that New Hampshire policymakers could learn something from this proposal."

The Claffeys moved to New Hampshire from Massachusetts more than 10 years ago. At the time, Claffey said, the tax issue was really a wash for the family.

Although her husband was no longer paying an income tax for his new teaching job in Nashua, the property taxes in New Hampshire were significantly high, as were car registration fees in the Granite State, according to Claffey.

Acknowledging that Patrick's proposal still has many hurdles to overcome, she believes it is appropriate in the grand scheme of tax fairness.

Taxation without representation

"It is frustrating to be impacted by decisions made by people you couldn't vote for or against," said Matt Lordan, a Litchfield resident who manages Durgan Travel Agency in Stoneham, Mass. "The phrase 'taxation without representation' comes to mind. I guess Massachusetts' response would be that if I don't like it, find a job in New Hampshire, but that's no easy task these days."

The Lordan household stands to lose 2 percent of its income to the proposal, if it's passed. Gretchen Lordan works as a teacher in the Tyngsborough, Mass.

"Right now, it feels like the world is piling on," said Mr. Lordan. "We've already received paychecks this year that were reduced. Gas prices are going back up. There's stories of milk prices doubling. Then you hear that your state income tax is now going up, and it's tough to take. Meanwhile, your income certainly isn't going up to match all these hits."

He added: "It makes it a little easier to take knowing these tax increases are earmarked for infrastructure and education, since I use their infrastructure every day and my wife is in the education field in that state. However, I think it was the easy way out for a lame-duck governor late in his final term to solve these funding problems with tax increases, when he should be cutting programs and stopping handouts. That is what really bothers me."

Litchfield resident Richard Montenaro, a construction worker, commutes daily to his office in Peabody, Mass., though his job assignments do bring him back across the border from time to time.

Montenaro said he's not all that concerned about a possible state income tax increase and probably wouldn't consider working in the Granite State because Massachusetts companies still boast a higher salary range for those in his line of work.

"I have no problem paying income tax because I'm using the roads in that state," he noted. "Plus, it's all about having a good accountant. With me, I can deduct those taxes for the days I've worked in New Hampshire."

Goffstown resident Ray Morley commutes to South Boston daily for his position in marketing services. Morley, who commutes by bus most days, shares Montenaro's views.

"Even with a small tax increase, the wage differences of Massachusetts versus New Hampshire are too great in my line of work," said Morley.

Nashua resident Jamie Turbyne, who commutes to a Boston suburb most days for his job in the high-tech industry, said an income tax increase on top of the recent 2 percent bump in federal taxes would result in "a meaningful hit to what comes in every two weeks."

Staff Writer Paul Feely and Correspondent April Guilmet contributed to this story. Kimberly Houghton can be reached at khoughton@newstote.com